Business Tech

Updated on January 6 at 11:20 a.m. PST with correction about Nano 3000.

Dual-core Intel Atom rivals are in the works.

Via Nano procesor

(Credit: Via Technologies)

Via Technologies is planning a very low-power, dual-core Nano 3000 processor, according to Chinese-language Web site HKEPC.

Via's C7-M processor is used in Hewlett-Packard's 2133 Mini-Note, which preceded the crop of Netbooks based on the Atom CPU. Via processors, however, were subsequently eclipsed by Intel's Atom.

Advanced Micro Devices will target its low-power dual-core "Conesus" at the laptop market segment above Atom's Netbook-centric space.

Meanwhile, Freescale Semiconductor has indicated that it will bring out a very-low-power ARM chip that features a dual-core graphics engine targeted at Netbook-like laptops.

All of these developments indicate that the market for ultra-small devices and laptops should heat up in 2009.

Intel currently offers the dual-core Atom 330 that is targeted at Nettops--small desktop computers.

The dual-core version of the Via Nano--due in late 2009 or 2010--may use a Fujitsu 45-nanometer or TSMC (Taiwan Semiconductor Manufacturing Company) 40-nanometer manufacturing process, according to HKEPC. The Intel Atom is based on 45-nanometer process technology.

(Correction: the Via Nano 3000 will not be dual-core. The dual-core version of Nano will ship in the second half of 2009.)

The Via chip may also include SSE4 instruction support, HKEPC said. Generally, SSE4 (Streaming SIMD Extensions 4) instructions speed up multimedia applications.

Via is also slated to bring out other improved Nano processors in 2009, according to the report.

As 2008 draws to a monotonous close, there is still a sliver of time left for me to make my 2009 networking predictions. Yes, money will be as tight as a Minnesota Senate race next year, but there certainly will be a number of bright spots. Here is my list of 10 technology areas to watch in 2009 (in no particular order):

1. Managed network services. Unlike other IT infrastructure areas (servers, storage, security equipment) large and small organizations have been buying network services for years (think Frame Relay, Centrex, etc.). This comfort level will persuade frugal chief information officers to pad contracts with additional services in 2009. Network service providers like AT&T, BT, and Verizon will prosper as IT managers eschew internal efforts and instead dabble in areas like managed network security, remote access, and WAN (wide-area network) optimization. I expect increasing quarter-to-quarter growth in many managed network services in 2009 and beyond.

2. Phat networks. While many IT projects will be put on the back burner, I still believe that we will see a lot of network backbone upgrades next year. Why? All of this Web 2.0/IT consumerization stuff generates a lot of traffic and the load isn't getting any lighter. Like it or not, CIOs will have to spring for 10Gb core switches and routers to keep remote and branch office workers productive and happy.

3. Unified communications. OK, now I'm in buzz-word territory but I see a problem and an opportunity here. The problem is that we are all communicating with each other using a half dozen or so independent technologies. We need to rein this in soon while integrating the concept of "presence" into our communications processes. On the flip side, there is a great opportunity to integrate unified communications into business processes to improve efficiency and service. Imagine how happy you'll be when your service call is answered by a product expert rather than a series of frustrating menus and gatekeepers.

4. 802.11n. I've been a believer in this next-generation WLAN (wireless local area network) standard for a while. In 2009, we should see significant growth in penetration and revenue. Given improvements in bandwidth and security, I expect to see 802.11n as a replacement for access switches as organizations refresh the network edge. I also anticipate additional manufacturing, health care, and government applications built to take advantage of the 802.11n momentum. Look for HP to become an aggressive competitor in the WLAN space while independents like Aruba and Meru get gobbled up by the likes of Juniper and Brocade/Foundry.

5. Core network services. I'm talking about services like DNS (domain name system), DHCP (domain host configuration protocol), RADIUS (remote authentication dial-in user service), and IP address management. With all of the networking activity in the past few years, these core services have been a virtually ignored kludge leading to unplanned downtime, security vulnerabilities, and manual operations. This mess must be fixed soon--good news for Blue Cat, Infoblox, and Juniper. Look for Microsoft to stir the pot with a core networking services appliance in 2009 as well.

6. Application networking. I'm combining two categories here: Application acceleration and WAN optimization. The year 2009 promises to consolidate tons of applications and services in massive data centers running on top of virtual servers. Users and virtual machines will be in a constant state of mobile flux while exchanging enormous files and speaking an ever-growing variety of network protocols. Someone has to play traffic cop to avoid gridlock so A10 Networks, BlueCoat, Citrix, F5, and Riverbed should do just fine.

7. Telepresence. The use of video conferencing should grow as companies restrict employee travel and equipment prices plummet. Cisco is about to announce a sub-$1,000 SMB platform while carriers are planning managed services offerings. But, telepresence growth will also expose its limitations. Business managers will discover that boring six-hour telepresence sessions are no substitute for actual human contact.

8. Virtual server and network integration. As physical servers host dozens of virtual guests, and virtual machines move from host to host, networking can get pretty dicey. The way around this problem is tight integration between virtual and physical switches. VMware and Cisco are already working on this but what about the other hypervisors (Citrix, Microsoft) and switching providers? Look for open application programming interfaces and one-off relationships in 2009.

9. Data center networking. Closely related to virtual server integration, expect to see more specific data center networking equipment from Extreme Networks, Force 10, and glamour start-up Arista Networks. Data center equipment will offer functionality like virtual switch integration, clustering, dense port counts, and support for IP storage. Cisco and Brocade/Foundry will focus in this area while Juniper and HP will aggressively push products and programs.

10. Real Cisco competitors. Cisco is a well-oiled machine but I see a perfect storm for others to gain share. With organizations looking to save money, technically advanced low-priced alternatives will look extremely attractive. I've already seen Aruba and Extreme win deals like this when Cisco was the incumbent. Along these same lines, the competition has never been stronger in terms of both technology and resources. Finally, as Cisco enters the blade server market, look for HP and IBM to cozy up to others or push their own gear. Brocade/Foundry, HP, Huawei, Juniper and others may gain share at Cisco's expense in 2009.

I'm sure I missed a few items but I'm just about out of time. Happy New Year!

Advanced Micro Devices said Monday that it will incur $70 million in restructuring costs in the fourth quarter, according to a filing with the Securities and Exchange Commission.

The filing also cited fourth-quarter layoffs of 600 employees. An AMD spokesperson said that approximately 500 layoffs were announced in November, but that the company "ended up closer to 600."

The restructuring dollar figure is new, AMD said. The company now estimates that the "restructuring expense that it will record in the fourth quarter of fiscal 2008 will be approximately $70 million, based on the restructuring plan approved by the Company on December 19, 2008."

Of the $70 million, about $34 million is related to severance and employee benefits, $13 million is related to contract or program termination costs, approximately $17 million is connected to asset impairments, and about $6 million is related to exit costs at facilities.

Previously, AMD had reported in a Form 10-Q filing that it expected to cut approximately 500 employees and take a charge to operations in the fourth quarter of fiscal 2008 of approximately $50 million.

Future cost reductions are also planned. "Further cost reduction actions will result in additional charges in the first half of fiscal 2009, which the company cannot estimate at this time," according to Monday's Form 8K filing.

AMD also said that on December 19 it determined that it would incur a material charge for impairment of assets during the fiscal quarter ended December 27 related to the 2006 acquisition of ATI Technologies. "The Company concluded that the current carrying value of its goodwill...was impaired." AMD added: "This conclusion was reached based on the results of an updated long-term financial outlook for the businesses of the former ATI Technologies Inc. in light of the current market conditions and economic outlook" and "due to the deterioration in the price of the Company's common stock and the resulting reduced market capitalization."

AMD expects that the impairment charge "will be material, but, as of the time of this filing...is unable to estimate the amount or range of amounts of the impairment charge. The Company will disclose such an estimate or range of estimates in a filing with the SEC promptly and in any event within four business days of determining such an estimate or range of estimates," according to the Form 8K.

The Sunnyvale, Calif.-based chipmaker split in two earlier this year in order to defray the burdensome costs of its manufacturing operations. The manufacturing operations received a massive investment from Mubadala Development Co. and is now run as a separate concern called The Foundry Company.

The price of its stock has sunk from about $6 in June of this year to a little more than $2.

Hewlett-Packard printers, like blue jeans in the old Soviet Russia, are apparently a hot item among consumers in Iran.

According to a report in Monday's Boston Globe, a third-party distributor in Dubai has been selling HP printers in Iran since 1997. That's two years after President Clinton signed an order banning all trade with the country. If HP executives cut the deal with the Dubai company, called Redington Gulf, knowing it intended to sell HP products into Iran, the deal could be a violation of trade law, according to the Globe.

But did HP know what the small Dubai outfit was doing? As the Globe reported, the distributor's Web site says it began in 1997 "as a team of five people and...HP supplies as our first product, we started operations as the distributor for Iran." The article also quotes an HP executive in the late 1990s enthusiastically discussing sales in Iran.

Since it was started, Redington has grown considerably, and now sells high-tech equipment throughout the Middle East and Africa for a number of manufacturers, ranging from other hardware makers such as Cisco and IBM to software makers such as McAfee and Microsoft. "Today," the company's Web site says, "Redington is proud to be described as 'the brand behind brands' in the region."

An HP spokesman told CNET News that HP has "a policy of complete compliance with all US export laws."

The Globe story comes at a particularly sensitive time, with fighting once again escalating between Israel and Hamas forces in Gaza. The trade embargo against Iran was put into place by President Clinton in 1995 to force the country to stop funding militant groups such as Hamas and Hezbollah, and to pressure it to curb its nuclear program.

But scarcity -- or at least the knowledge that owning an HP printer is in some way taboo -- has had the opposite impact: It has made them highly desirable among Iranian consumers. By some accounts, HP has better than a 40-percent share of the Iranian printer market.

Intel has launched a low-cost quad-core mobile processor and added more mobile Core 2 Duo processors to its chip lineup, according to an updated price list dated December 28.

Acer was one of the first PC makers to announce a system with the new quad-core processor. On Monday Acer released the Aspire 8930G-7665 laptop designed for extreme gaming using the new Intel Core 2 Quad Mobile Processor Q9000, which runs at 2.53GHz. The laptop comes with a 18.4-inch WUXGA screen and Nvidia GeForce 9700M GT graphics. It is priced at $1,799.

The Q9000 processor is listed at $348, significantly less expensive than the existing QX9300 mobile quad-core processor, which is listed at $1,038, and the Q9100, listed at $851. Both of these processors, however, have 12MB of cache memory, twice the amount of the cheaper Q9000, which integrates 6MB of cache. Generally, the more cache memory, the faster the processor.

Intel also released other mobile processors: the 2.93GHz T9800 ($530), the 2.66GHz P9600 Core 2 Duo ($348), the 2.66GHz T9550 ($316), and the 2.53GHz P8700 ($241).

T series processors typically have a power envelope (TDP, or thermal design power) of 35 watts, while P series chips have a 25W TDP.

Microsoft has applied for a patent on metered, pay-as-you-go computing.

U.S. patent application number 20080319910, published on Christmas Day, details Microsoft's vision of a situation where a "standard model" of PC is given away or heavily subsidized by someone in the supply chain. The end user then pays to use the computer, with charges based on both the length of usage time and the performance levels utilized, along with a "one-time charge."

Microsoft notes in the application that the end user could end up paying more for the computer, compared with the one-off cost entailed in the existing PC business model, but argues the user would benefit by having a PC with an extended "useful life."

"A computer with scalable performance level components and selectable software and service options has a user interface that allows individual performance levels to be selected," reads the patent application's abstract. The patent application was filed June 21, 2007.

"The scalable performance level components may include a processor, memory, graphics controller, etc. Software and services may include word processing, email, browsing, database access, etc. To support a pay-per-use business model, each selectable item may have a cost associated with it, allowing a user to pay for the services actually selected and that presumably correspond to the task or tasks being performed," the abstract continues.

Integral to Microsoft's vision is a security module, embedded in the PC, that would effectively lock the PC to a certain supplier.

"The metering agents and specific elements of the security module...allow an underwriter in the supply chain to confidently supply a computer at little or no upfront cost to a user or business, aware that their investment is protected and that the scalable performance capabilities generate revenue commensurate with actual performance level settings and usage," the application reads.

'A more granular approach'
According to the application, the issue with the existing PC business model is that it "requires more or less a one chance at the consumer kind of mentality, where elasticity curves are based on the pressure to maximize profits on a one-time-sale, one-shot-at-the-consumer mentality."

Microsoft's proposed model, on the other hand, could "allow a more granular approach to hardware and software sales," the application states, adding that the user "may be able to select a level of performance related to processor, memory, graphics power, etc that is driven not by a lifetime maximum requirement but rather by the need of the moment."

"When the need is browsing, a low level of performance may be used and, when network-based interactive gaming is the need of the moment, the highest available performance may be made available to the user," the document reads. "Because the user only pays for the performance level of the moment, the user may see no reason to not acquire a device with a high degree of functionality, in terms of both hardware and software, and experiment with a usage level that suits different performance requirements."

By way of example, the application posits a situation involving three "bundles" of applications and performance: office, gaming, and browsing.

"The office bundle may include word-processing and spreadsheet applications, medium graphics performance and two of three processor cores," the document reads. "The gaming bundle may include no productivity applications but may include 3D graphics support and three of three processor cores. The browsing bundle may include no productivity applications, medium graphics performance and high-speed network interface."

"Charging for the various bundles may be by bundle and by duration. For example, the office bundle may be $1.00 [68 pence] per hour, the gaming bundle may be $1.25 per hour and the browsing bundle may be $0.80 per hour. The usage charges may be abstracted to 'units/hour' to make currency conversions simpler. Alternatively, a bundle may incur a one-time charge that is operable until changed or for a fixed-usage period," the document reads.

Microsoft's patent application does acknowledge that a per-use model of computing would probably increase the cost of ownership over the PC's lifetime. The company argues in its application, however, that "the payments can be deferred and the user can extend the useful life of the computer beyond that of the one-time purchase machine."

The document suggests that "both users and suppliers benefit from this new business model" because "the user is able to migrate the performance level of the computer as needs change over time, while the supplier can develop a revenue stream business that may actually have higher value than the one-time purchase model currently practiced."

"Rather than suffering through less-than-adequate performance for a significant portion of the life of a computer, a user can increase performance level over time, at a slight premium of payments," the application reads. "When the performance level finally reaches its maximum and still better performance is required, then the user may upgrade to a new computer, running at a relatively low performance level, probably with little or no change in the cost of use."

2009 may be the year of the Netbook. But there's a big if.

Here's the choice: Will consumers buy a thin, light, relatively fast $1,800 MacBook Air or a thin, light, ultrasmall, not-as-fast $450 Hewlett-Packard Mini 1000 Netbook? (Correction: the HP Mini 1000 configuration cited here was originally stated incorrectly as $700.)

A $400-$700 Netbook or a $1,800-$2,500 notebook?

(Credit: Hewlett-Packard, Apple)

If many people, fully aware of this choice, opt for a Netbook then we have the foundation of, at the very least, a rethinking of the pricey ultraportable.

At most, we have many more consumers buying into the Netbook concept--particularly if 3G broadband wireless comes as a standard option.

Here's the dilemma in more detail: Do you want an ultralight subnotebook replete with a Core 2 Duo processor, 64GB solid-state drive, and 12-inch (or 13-inch) LED screen that will set you back at least $1,800?

Or do you want a Netbook with an Atom processor, 16GB solid-state drive (or 60GB or 120GB hard disk drive), and a 10-inch screen for $450 to $500? (Clarification: Netbooks are generally thought of as sub-$400 designs; but for comparison's sake, upscale Netbooks with 10.2-inch screens are cited here.)

The dimensions and weight are the key to both the Netbook and the ultraportable, and differentiate them from standard laptops. Both are small and light. But here's where Netbooks become disruptive. To date (that is, for at least the last 10 years), consumers have had to pay a big premium for smallness and thinness (and still do with the Air, Dell Latitude E4200, and Toshiba Portege, for example). With the Netbook, they don't. (The one obvious downside to Netbooks, however, is that they're too small--cramped screens and keyboards.)

(See CNET review of the HP Mini 1000.)

Of course, the design and internals are different, but are they different enough? To rephrase the question posed above: Is a $2,500 13-inch MacBook Air with a 128GB solid-state drive (and no 3G) different enough from (or that much better than) a high-end $600 or $700 11-inch Netbook with a 32GB (or 64GB) solid-state drive and 3G? I would expect that most consumers (even ones that must have an ultraportable laptop) won't be able to justify paying an extra $1000-$2,000 for a MacBook Air- or Toshiba Portege-style design in the face of a compelling array of Netbook offerings. Especially if Netbooks (or a facsimile of the Netbook) start sporting larger screens.

Consumers will ultimately decide the fate of the Netbook of course--though it remains problematic whether PC suppliers will really push Netbooks in front of consumers that aggressively if Netbooks are eating into their laptop sales. Advanced Micro Devices or Via Technologies, however, could change this by aggressively promoting their newest silicon (AMD's Yukon and Via's Nano) for slick, upscale Netbook-like designs.

When Apple converted to Intel in 2005 that was big. But 2008 Intel Atom converts make this look like a small-town baptism.

Overall, it was a good year for the Intel faithful despite the Wall Street financial crisis. Intel handily beat Advanced Micro Devices in the PC processor performance war. (Not coincidentally, AMD was forced to spin off its manufacturing operations to save itself.) But that really was last year's news since AMD had not been delivering competitive processors for almost two years.

iBook G3: Apple's conversion from IBM-Motorola to Intel pales against the conversion of PC makers to Intel's Atom

(Credit: CNET Networks)

The tectonic shift in 2008 came as one PC maker after another adopted Intel's new Atom processor. Count 'em: Acer, Asus, Dell, Hewlett-Packard, Lenovo, Toshiba--to mention only the largest vendors. (Atom shipments in the third quarter were strong and expected to hit between 10 and 20 million units this year.)

This wasn't one sole convert (like Apple), this was a Pentecostal conversion of biblical proportions. Almost overnight, the entire top tier of the PC industry got the Atom religion. In fact, it happened so quickly and so massively that companies like AMD and Qualcomm didn't know what hit them.

Wait a minute, Qualcomm seemed to say, we specialize in making chips for small devices, why is Intel running away with this market? (Even Intel was a bit surprised at the swiftness of Atom adoption in Netbooks.) And though AMD had helped pioneer the market by supplying its Geode processor for the progenitor of the Netbook, the One-Laptop-Per-Chip XO laptop, the Geode never came close to the commercial success (or performance) of the Atom.

AMD took notice, however, and said it plans to deliver a processor for the ultraportable market (an upscale Netbook or cheap notebook--however you want to look at it) at the Consumer Electronics Show.

And Nvidia followed suit. And seemed to be posing the same questions. Hey, if everyone's doing this, is this the Second Coming of the PC? Or, at least, a restructuring of the traditional price structure of the PC market? (The other question Nvidia is asking itself is whether it can bust the Intel bundling Juggernaut).

Oh, and we almost forgot Microsoft. Not initially enthusiastic about the Netbook market because of its XP-centric nature, Microsoft seems to have also gotten the Netbook religion with Windows 7 which will be ready for Netbooks from day one.

An Arizona-based networking company on Wednesday filed a lawsuit against Google, Microsoft, and Apple, alleging that all three tech giants violated a patent it owns on the use of document-preview icons--or thumbnails--in operating systems.

In the suit (PDF), Cygnus Systems targets Google's Chrome, Microsoft's Vista and Internet Explorer 8, and Apple's iPhone, Safari, and Mac OS X as patent infringers. Apple uses the patent-protected technology in its Finder and Cover Flow Mac OS X features, the lawsuit claims.

Cygnus describes the technology covered by the patent as "methods and systems for accessing one or more computer files via a graphical icon, wherein the graphical icon includes an image of a selected portion or portions of one or more computer files."

E-mails seeking comment from Google, Microsoft, Apple, and Cygnus' attorney were not immediately returned.

The case was filed in U.S. District Court in Arizona, where company owner Gregory Swartz lives, according to PCWorld.

Cygnus was granted the patent in March 2008, according to the lawsuit, although it first applied for it back in 2001 as a continuation to a 1998 application, according to Ars Technica, which appeared to report the case first.

Cygnus is seeking damages and a permanent injunction to prevent further alleged infringement. It has also indicated that it might go after other companies as defendants.

Here's a little statistical cheer for online retailers bracing themselves for what many have been predicting will be a dismal holiday sales season.

The latest online retail spending report released Tuesday by ComScore shows that consumers last weekend spent almost double what they spent on the corresponding weekend before Christmas last year. U.S. consumers online spent $677 million last weekend, December 20 and 21, compared to $341 million the weekend before Christmas in 2007, which was December 22 and 23.

It should be noted, however, that there are five fewer days this year between Thanksgiving and Christmas, making it harder to make perfect year-to-year comparisons. For example, the $677 million in sales last weekend--which was also the fourth weekend after Thanksgiving--is actually down 17 percent from last year's corresponding fourth weekend after Thanksgiving, December 15 and 16.

Whether you see the glass half full or half empty, the statistics suggest "that many consumers opted for the cozier confines of online shopping rather than having to brave the severe cold and snowstorms affecting much of the northern half of the country," ComScore Chairman Gian Fulgoni said in a statement. He added that the compressed shopping season probably resulted in some consumers buying online later than they did last year.

Regardless, the report is further evidence that holiday sales aren't a total disaster and might even be holding their own, which is no small feat in the throes of a recession. U.S. online spending to date this holiday season (from November 1 to December 21) totals $24.71 billion, down 1 percent from the corresponding timeframe last year.

Considering we're in the throes of a recession, online holiday sales appear to be generally holding their own.

(Credit: ComScore)